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G-III Apparel Group (GIII) Q3 Earnings: Stock to Disappoint?

EXPR ASNA KR GIII

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G-III Apparel Group, Ltd. (GIII - Free Report) is scheduled to report third-quarter fiscal 2017 results on Dec 1. In the preceding quarter, the company’s earnings missed the Zacks Consensus Estimate by an average of 94.1%. Notably, its earnings have missed the Zacks Consensus Estimate in the trailing four quarters, with an average of 12.6%.

Zacks Model Shows Unlikely Earnings Beat

Our proven model does not conclusively show that G-III Apparel Group is likely to beat estimates this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), #2 (Buy) or #3 (Hold) for this to happen. G-III Apparel Group has an Earnings ESP of -1.96%, as the Most Accurate estimate stands at $1.50, while the Zacks Consensus Estimate is pegged higher at $1.53. The company carries a Zacks Rank #4 (Sell), which when combined with an ESP of -1.96%, makes the chances of an earnings surprise minimal.

We caution against stocks with a Zacks Rank #4 or 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Factors Influencing this Quarter

We don’t expect G-III Apparel Group to beat earnings estimates in third-quarter fiscal 2017 primarily due to concerns over the performance of the company’s wholesale outerwear sales. Earlier, the company had said that wholesale outerwear sales are expected to decline in the high-single digit percentage in fiscal 2017, whereas the same will likely decrease nearly 20% in the third quarter.

For the fiscal third quarter, the company expects net sales of nearly $940 million compared with $910 million in the prior-year quarter. Earnings per share are expected between $1.50 and $1.60 compared with $1.87 reported in the year-ago period.

G-III APPAREL Price, Consensus and EPS Surprise

G-III APPAREL Price, Consensus and EPS Surprise | G-III APPAREL Quote

Other Stocks that Warrant a Look

Here are some companies you may want to consider as our model shows that these have the right combination of elements to post an earnings beat:

The Kroger Co. (KR - Free Report) has an Earnings ESP of +9.52% and carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Ascena Retail Group Inc. (ASNA - Free Report) also carries a Zacks Rank #3 and has an Earnings ESP of +14.29%.

Express Inc. (EXPR - Free Report) has an Earnings ESP of + 8.33% and carries a Zacks Rank #3.

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